Category Archives: 1. Stage One – Assess

Because I’m a serial entrepreneur and because some of those companies did well and because I’m a management consultant and startup mentor and coach and because I’m a business plan/pitch competition judge, I get asked this question in various forms—a lot.

Here is one recent example:

How would I go about researching an on-line business idea? I have an idea and have done some Google searches but don’t know how to tell if there is room in the market for someone else. I have some ideas to be more unique and have a plan to slowly enter the market, but not sure how to go about everything. The last time I tried a business it failed miserably, so I want to avoid that and keep things simple.

During the very early days of a business, in stage one, decisions are made which determines the initial trajectory of a business. While you can always pivot and change direction, every pivot costs resources.

In the early stages of a business, you don’t have much in the way of resources, so limiting the number of pivots is directly related to efficiency.

Here’s some counsel I recently provided to a couple of engineers who have an early stage Big Data startup:

You are currently early in stage one here: www.IdeaToExit.com. You have made some preliminary decisions regarding the business model, but have yet to progress through the most important stage one section: market sizing.

Addressable (all customers on the planet who could conceivably buy your products/services)

Relevant (the portion of the addressable market who currently buys your products/services)

Target (your ideal customers)

Serviceable (the customers you could service with your available resources; here assume that you obtained sufficient startup capital to create the minimum business model reflected in your financial projection scenarios)

The four reasons your products/services are need to have purchases for your customers (as opposed to nice to have or want to have)

The most important customer benefits of your products/services (these must be customer benefits, not product/service features)